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Generic competitive strategies (1. Low-cost provider (striving to achieve…
Generic competitive strategies
1. Low-cost provider
striving to achieve lower overall costs --> under pricing rivals
used in market with
price-sensitive buyers
achieved by value chain activities more effectively than rivals & eliminating some cost producing activities
strive to operate with exceptionally small corporate staff -> admin costs to minimum
pep; jet
2. Broad differentiation
differentiate co's p/s from rivals in ways that appeal to broad spectrum of buyers
buyers' needs & preference are too diverse to be fully satisfied by standardized p&s
pursue differentiation from many angles:
multiple features -> MS Windows
engineering, design/performance -> BMW, Mercedes
quality manufacturing -> Michelin tires
3. Focused low-cost strategy
concentrates on narrow buyer segment (market niche)
outperforming rivals by having lower costs -> serve niche members @ lower price
size of buyer group is appealing to
kulula.com; FlySafari
4. Focused differentiation
concentrate = narrow buyer segment (market niche)
outperforming rivals by offering niche member customized attributes that meets taste & requirements better than rival
SAA
5. Best-cost provider
giving customers more value for money -> satisfying expectations on key quality features/performance/service attributes while beating price expectations
middle ground between low-cost & differentiation advantage
appealing to broad market as a whole & narrow market niche
Toyota, Lexus